Sheldon Adelson told a jury he wasn’t involved in and didn’t authorize an offer that former Las Vegas Sands Corp. (LVS:US) President William Weidner made to a Hong Kong businessman for a share of the company’s profit in Macau.
Adelson, 79, founder, chairman and chief executive officer of Sands, testified for a second day in Las Vegas in the trial over Richard Suen’s claims that he’s owed $328 million for helping the company win a license in 2002 to operate casinos in the former Portuguese colony.
This is the second time the claims have gone to trial. The Nevada Supreme Court in 2010 reversed a $43.8 million jury award two years earlier in favor of Suen and sent the case back for a new trial. Suen alleges he had an agreement that he and his associates would get $5 million and 2 percent of Sands’ Macau net income if the company was awarded a license.
“I would not have approved this,” Adelson said yesterday under questioning from Suen’s lawyer, John O’Malley, about a June 2001 fax Weidner sent to Suen outlining the terms of an agreement. “I had nothing to do with it.”
Adelson said he was too ill in the fall of 2001, suffering from a nerve disease that left him in severe pain and unable to be involved in daily operations of his company. He said Weidner, who is scheduled to testify next week, was filling in for him about half of the time during that period and made the offer to Suen without his authority.
“If he could deliver a license without us having to compete for it, then of course I would have been happy to pay him,” Adelson said of Suen.
Suen, a business friend of Adelson’s brother Leonard Adelson, represented he could deliver a license without any competition if the Macau government ended the monopoly that Stanley Ho had on gambling in region prior to the handover to China, the Sands chairman testified.
“That’s what he said,” Adelson told the jury. “Why else would I deal with this guy?”
Adelson accused Suen, who is sitting with his lawyers, of smirking at him during his testimony. He also accused Steven Jacobs, the former chief executive of the Sand China Ltd. who is also embroiled in a lawsuit with Adelson and who is attending the trial, of smirking at him from the audience.
“Mr. Jacobs has been smirking since yesterday afternoon,” Adelson said about the executive he fired in 2010.
Suen claims that meetings he arranged between Adelson and Chinese officials, including the mayor of Beijing and the vice premier responsible for Hong Kong and Macau, were instrumental in leading Edmund Ho, the former chief executive of the Macau Special Administrative Region, to award the company a gaming license in 2002.
Adelson testified that after the Macau government solicited public offers for gaming concessions in October 2001, the relationships Suen alleged to have to provide a license were no longer relevant.
Suen, who Adelson said was in the business of making plush toys, had no expertise in public relations or finding investors, Adelson testified. Las Vegas Sands won the right to operate casinos in Macau, without Suen’s involvement, by joining the bid of a Hong Kong investor group that got one of the three gambling concessions awarded in 2002, Adelson said.
The company had earlier joined forces with a Taiwanese bank that would finance the casinos in Macau managed by Las Vegas Sands. When the Macau government rejected that proposal, three weeks before the winning bids were announced, Las Vegas Sands was paired, as management company, with Galaxy Entertainment Group Ltd. (27), the Hong Kong investors.
The venture with Galaxy was set up after Adelson was approached by a “messenger” he assumed was from Edmund Ho, Adelson said.
When the venture with Galaxy didn’t work out because the Hong Kong group didn’t want to disclose its partners, which turned out to include the son of a reputed “triad member,” the Macau government allowed Las Vegas Sands to build its own casinos under a subconcession from Galaxy, Adelson said.
Suen approached him after Las Vegas Sands got the subconcession in December 2002 seeking compensation for helping win the right to operate casinos, Adelson said.
“I said you haven’t done anything, why should I pay you any compensation,” Adelson testified.
Adelson said at the urging of his brother Lenny, he offered Suen a position as procurement agent so he could “earn a lot of money.” That offer had nothing to do with Suen’s claim that he was entitled to be paid for helping to deliver the Macau subconcession, Adelson said.
Under cross-examination from Las Vegas Sands lawyer Richard Sauber, Adelson testified he was one of four children of immigrant parents in Boston who got in the trade-show business in 1972 after various ventures.
“I would have been a rags-to-riches story except that my parents couldn’t afford the rags,” Adelson said.
The case is Suen v. Las Vegas Sands Corp., 04A493744, Nevada District Court, Clark County (Las Vegas).
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